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Frequently Asked Questions

Frequently Asked Questions are used to provide additional information and/or statutory guidance not found in State Medicaid Director Letters, State Health Official Letters, or CMCS Informational Bulletins. The different sets of FAQs as originally released can be accessed below.

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Our state included dental services along with physician (non-dental) services in our state's Upper Payment Limit (UPL) demonstration of the practitioner Average Commercial Rate (ACR) using the Medicare Equivalent of the ACR. Should we keep both services together in one demonstration or should we separate the services out for two different ACR demonstrations?

Dental services are not covered under Medicare, which means the state may not compare Medicaid rates for comparable dental services for the Medicare Equivalent of the ACR. The state may calculate a dental ACR in order to make supplemental payments to dental services providers and continue to calculate the Medicare Equivalent of the ACR for other services covered by Medicare. The state should submit two separate ACR demonstrations, one for dental services and one for physician (non-dental) services. This will involve completing two versions of the Office of Management and Budget-approved template. If the same provider provides both physician and dental services the state would differentiate the provider information between the two demonstrations by appending the Medicare Certification Number (Medicare ID) (variable 112) with a letter, such as an -A or a -B. For example, if the Medicare ID was 123456, it would be depicted in the physician ACR as 123456-A and in the dental ACR as 12345-B. If a Medicare Certification Number is not available then the state should append the Medicaid Provider Number.

FAQ ID:92441

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How does this durable medical equipment (DME) limit on federal financial participation (FFP) affect those states that are 90% managed care?

As we explained in the January 4, 2018 letter, only those items provided in the Medicaid program on a fee-for-service (FFS) basis are to be included in the aggregate expenditure calculation. DME reimbursed under a Medicaid managed care arrangement or a Medicaid competitive bidding contract are not subject to the FFP limitation. If a state is 90% managed care the state would only have to show compliance or a demonstration with the 10% of FFS utilization and expenditures for the relevant DME items.

FAQ ID:93531

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Do the managed care organizations (MCOs), who are contracted to provide services to our Medicaid clients, have to comply with the durable medical equipment (DME) limit on federal financial participation (FFP)?

So long as the MCOs are not paid on a fee-for-service (FFS) basis, MCOs are not covered under this statute or subject to the limit on FFP. Only the relevant DME items provided in FFS are included in this limit.

FAQ ID:93536

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Are states that provide durable medical equipment (DME) through a managed care arrangement required to submit the reconciliation data?

Only those items provided in the Medicaid program on a fee-for-service basis are to be included in the aggregate expenditure calculation. DME reimbursed under a Medicaid managed care arrangement or a Medicaid competitive bidding contract are not subject to the federal financial participation limitation.

FAQ ID:93541

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Centers for Medicare & Medicaid Services is saying this durable medical equipment (DME) limit on federal financial participation is applicable only to fee for service (FFS). How about the Home and Community-Based Services (HCBS) waiver programs?

If the HCBS waiver includes FFS payments for DME, the state’s expenditures for DME would be subject to the limit.

FAQ ID:93546

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